Trade for prosperity

Will Lockhart, Deputy Director for Biodiversity and Wildlife at Department for Environment Food and Rural Affairs

We are losing nature faster than ever before. Across the globe species, habitats and entire ecosystems are fading before our eyes. The mass extinction of biodiversity is taking place and the time to act is now. 

Rich and diverse landscapes are essential for the health of the planet. And businesses too. More than half of global GDP – $44 trillion – is estimated to be highly or moderately dependent on nature. The decline of biodiversity, the loss of tropical forests, collapse of global pollinators and reduction in marine fisheries could lead to a contraction of global GDP by 2.4% by 2030.1  

Businesses – both large and small – have a critical role to play in halting and reversing the decline in biodiversity loss. 

Nature is good for business 

Climate decline and biodiversity loss are arguably the biggest challenges facing businesses today. To some extent, all businesses are exposed to climate and nature risk, and all consumers will ultimately be affected. For instance, farmers are facing rapidly-changing weather conditions, leading to unpredictable crop yields which could impact the productivity of the food and beverage sector in the long term. And if forest loss continues at the same rate in the Amazon, models suggest that this could result in more frequent droughts, creating agricultural production losses amounting to $422 million in Brazil alone – with knock on impacts around the world. 

But the food and drink sectors are not alone in their exposure to nature risk. No sector is immune from the nature crisis. Chemicals and materials, aviation, travel and tourism, real estate, mining and metals, supply chain and transport, retail and consumer goods: the list goes on. 50% of the Gross Value Added of the supply chains of these sectors is highly or moderately dependent on a thriving and productive natural world. 

The 2021 Dasgupta Review commissioned by HM Treasury into the economics of biodiversity outlined that our ability to produce valuable goods and services for a growing population is bound by the fact that we cannot live outside nature.2

Central banks are directly exposed to the risk posed by the decline in nature too – research from the central bank in France found that 36% of portfolios are highly dependent on biodiversity. 

So a prospering natural environment makes good practical, economic, fiscal and moral sense. The importance of nature cannot be overlooked.

A planet in crisis  

The reality and the enormity of the climate and nature crisis was highlighted at COP26 in Glasgow last year. The UK Presidency put nature at the heart of the COP and businesses, eNGOs and countries came together to make ambitious commitments. More than 100 world leaders committed to halting and reversing deforestation and land degradation by 2030, supported by £14bn in funding, an unprecedented agreement that prioritises the  recovery and renewal of the climate. Significant pledges were also made to keep the target of limiting temperature increases to 1.5 degrees alive with many countries agreeing to phase out the use of coal power.3  

But there is more to be done. We need wider and deeper protections to safeguard the natural world, and the plants and species within it. In August this year, global governments will come together to agree a new global framework for biodiversity. At the UN Convention on Biological Diversity COP15, a counterpart to the COP26 conference, parties will agree a set of wide-ranging and transformative targets to tackle biodiversity loss. They will include new targets to ensure that the 30% of the world’s land and ocean is protected by 2030; that species extinctions are halted; that there is sufficient finance to achieve the targets; and that businesses properly consider their dependence on nature. All the targets are designed to ensure that the world’s forests, seas and landscapes are home to a varied mixture of species and plants. 

The road to COP15 

The UK will play a leading role in developing an ambitious framework to protect global biodiversity. Engagement with other key countries is taking place to generate momentum and support ahead of the COP15 conference – the UK co-leads the Global Ocean Alliance and co-chairs the High Ambition Coalition, together a group of over 100 countries who are committed to advancing protection of the land and the ocean, to create a prosperous future for people and the planet. 

Work to develop the new global framework is underway. After a two-year long hiatus due to the pandemic, in person negotiations took place in Geneva in March 2022. The UK positively engaged with different nations to seek support for ambitious outcomes, for the agreement to halt and reverse the loss of nature by 2030. 

This laid a firm foundation which will act as a springboard for the COP15 conference later this year. 

There is much more work to be done in the coming months as countries return from Geneva and consider their next steps. Attention will turn to confirming agreements on nature finance, the fair use of resources and sharing of benefits. More talks will be held in Nairobi in June to discuss finer details of the agreements, before the COP15 conference takes place later this year. 

To ensure that the new framework succeeds, ambitious ecosystem and species targets need to be accompanied by measures to support their implementation. Finance from all sources and strengthened mechanisms for the report and review of actions is needed to hold parties to account.  

And businesses have a key role to play too. Committing to fair supply chains and the responsible use of resources is essential for supporting the future of the planet. Taking ambitious steps to factor nature into your business decisions can today sometimes feel like you are taking a leap in the dark and exposing yourself to an unnecessary additional cost burden. But the CBD presents us with an opportunity to agree – as a global community – about what we need to do to protect and conserve nature. You can lend your voice to calling on governments – across the length and breadth of your supply chains – to agree ambitious targets for businesses that will level the playing field around the globe. 

A future for businesses 

Businesses won’t be immune from the biodiversity crisis. With every sector and supply chain embedded into the natural world, it is essential that the diversity of our ecosystems is protected long into the future for the prosperity of people, business and the planet. 

COP26 told a powerful story about the readiness of businesses to factor climate into their decision-making processes, to end the depletion of the natural world on which we all depend. It’s time to do the same for nature.

References
1 Nature Risk Rising: Why the Crisis Engulfing Nature Matters for Business and the Economy, World Economic Forum, January 2020.
[https://www.weforum.org/press/2020/01/half-of-world-s-gdp-moderately-or-highly-dependent-on-nature-says-new-report/]
2 The Economics of Biodiversity: The Dasgupta Review, Professor Sir Partha Dasgupta.
[https://www.gov.uk/government/publications/final-report-the-economics-of-biodiversity-the-dasgupta-review]
3 https://www.gov.uk/government/news/over-100-leaders-make-landmark-pledge-to-end-deforestation-at-cop26

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